Experts at the Halifax building society are predicting a 4.5% fall in house values this year, meaning that prices are approximately 20% lower than the 2007 peak. This drop may seem alarming in itself, but one cannot ignore the fact that the average cost of a home, at over £160 K, is historically still very high, and out of reach for many first-time buyers looking to get on the property ladder.
In part this has seen a shift towards developers seeking to build a higher proportion of large properties, aimed at people trading up, but it is imperative that first time buyers are attracted back to kick start the chains. And one of the ways the sector is doing this is through off-setting payments for purchasers and offering solutions such as shared equity deals.
Often with this type of tenure, key workers and others identified as in housing need, are able to mortgage say 50 % of a property through a registered social landlord or housing association, which retains ownership of, and charges an affordable rent on the remaining value.
Alternatively one of Plastic Surgeon’s national housebuilder clients, Taylor Wimpey, offers a shared equity scheme called Easystart. In some instances, it helps people own 100% of their home at 85% of its present price. Another client for whom the company works, Redrow, provides a similar scheme with Easi:buy – both initiatives present the opportunity to pay back the rest over 10 years, with no rent charged.
One of the reasons the big firms can afford to do this is that they have become far better at controlling construction costs during the downturn: making use of offsite solutions and by employing Plastic Surgeon’s services. Having the finishers repair damaged kitchen worktops, gouged doors or floors, and scratched glazing, tiles or bathroom suites saves both cost and landfill.